AVAILABLE statistics of the United Nations show that 72% of Africans live under the most appalling conditions; in slums and squatter settlements without adequate shelter or basic services. Nigeria, according to world economic assessment, was rated 95th in terms of global competitiveness out of 128 countries involved in a survey, and global competitiveness is notably dependent on infrastructure. African countries have failed to provide housing needs for its citizens despite population expansion across the continent. In many African countries, a wide gap exists between housing needs and housing supply. Unfortunately and shockingly, Nigeria has the starkest cases with a backlog of four million housing units and is able to supply through the formal housing sector 10,000 units per annum. While the United Nations estimates show that in Uganda there is a backlog of 70,000 housing units with a national supply of only 5,000 units annually, in Tanzania, there is a national shortfall of over two million housing units. The failure of many African countries to tackle large scale land reforms means that this problem is becoming ever more critical as populations are increasing and there is more pressure on the available land.
The project
The project is the establishment of real estate business to build houses for the poor masses of the African society in general and Nigerians in particular. The project aims at eradicating poverty and aid Nigeria in meeting the vision 20: 2020 through provision of housing infrastructure for the poor and downtrodden. The houses will be of two types: the one room self contained and the mini flat housing units with modern toilet, kitchen and ventilation facilities. The project will be sited in the urban areas targeted at the city slum dwellers who presently live in “face -me -I -face -You’ shabby houses. These shabby houses are horrible and portends health hazards as each unit can contain 14 rooms with each room facing another, and also 5 rooms boys quarters at the back, all situate in a plot of land. Invariably, a unit of the house accommodates nineteen families of different ethnic and tribal nationalities sharing the same pit latrine toilet, bathroom, kitchen and other common interests. This project will improve the lots of these poor masses without impoverishing the investor, as no government ever or in the near future had plans of venturing into this business. The much publicized “Low cost Housing Estates’’ by Nigerian governments are for the middle class people as the “low cost’’ is far beyond the financial muscle of the poor.
Project procedure
Building the houses does not imply acquisition of large expanse of land and building estates, but where possible, depending on the financial strength of the investor, it is recommendable. A plot of land is enough to erect a unit of upstairs house with 16 Nos. self-contained apartments, or 10 Nos. mini-flats. The houses can be sited in different locations in a particular city. Prospective tenants shall pay rent on monthly basis. The rent shall vary from N3, 000 to N1, 500 for the mini flat and the self contained apartment, respectively. Interested tenants can be made to register with the National Housing Fund Scheme, the mortgage banks, and the micro-finance banks with the view of buying over their apartments.
Market/Profitability
There is wide market for the houses in Nigeria with great potentials of expanding the business to other African countries to earn foreign exchange. In Nigeria, over 70% of the population are poor and cannot afford the financial demands of living in the governments’ “low cost housing estates’’. About 40% of the poor dwell in the city slums yearning for deliverance. Profitability in this business is based on the rule of large numbers as the houses will be hot cakes for the urban slum dwellers. The high demand for the houses will generate high turnover with multiplier effects that will guarantee over 200% return on initial capital outlay.
Financing/Economic Benefits
The challenges in the housing sector in Nigeria can only be surmounted by provision of adequate housing units for the poor by timely intervention of private sector participation if Nigeria is to meet “Goal 7, Target 11, of the millennium development goals (MDGs) of improving the lives of 100 million slum dwellers while preventing the formation of new ones’’.The slum dwellers are centers of misery, squalor, crime, violence, insecurity and tools of social exclusion that have failed to contribute positively to national development. Therefore, provision of adequate housing facilities for the poor will turn them into centers of opportunity and creativity, contributing positively to national development while boosting the economic fortunes of the investor. The viability of this project makes it attractive to funding by mortgage banks, the national housing fund, micro finance banks and the commercial banks to augment the finances of the investor.
Project implementation
Venturing into this hidden treasure island does not require the investor being a professional building engineer or real estate consultant. What it needs is the will power and financial ability of the investor. The investor and his colleagues must have on their table, as a guide, a detailed and bankable feasibility report on this project before implementation.
All interested investors can contact the writer for details and assistance.